He says the factory is a crowded mess, with production 30% below targets, but isn't dissuaded by the missteps.

"Failure is where one learns the most," he told clients of Elon Musk's very public stumbles to reach production targets.

Pierre Ferragu has been Tesla's most optimistic Wall Street analyst for the better part of a year, and he isn't giving up hope anytime soon.

After a recent tour of the company's factory in Fremont, California, the New Street Research analyst has reaffirmed his $530 price target for the stock — well above Wall Street's consensus of $327 — despite a scrapped conveyer-belt system and unused production capacity.

"We were impressed to see how the lack of space and the overly ambitious initial design of the Model 3 production line created a lot of unnecessary complexity in the factory," Ferragu said Tuesday in a note to clients. "The place is a crowded mess!"

The factory was initially designed to have two layers, with one moving parts for assembly and the other moving assembled vehicles. But when Ferragu visited last week, CEO Elon Musk's grand plans for the place seemed to have faded.

"None of this worked much," Ferragu said. "The conveyor belt system has been scrapped and supplies are brought manually to each assembly step, creating a fairly impressive mess across the floor. Production lines are 30% less productive than initially anticipated."

"All this feeds a lot of bear argument on the company — we see it the exact opposite way," he said.

"Failure is where one learns the most. The third assembly line, pulled together under a tent in three weeks, is impressively efficient and well-organized. One more time, by shooting way too high, Tesla failed on its original plan, but achieved a world-class result."